Traditional coffee shop operator offers 173.8m shares at S$0.25 each in Singapore IPO

KIMLY Limited, a traditional coffee shop operator in Singapore, is offering 173.8 million new shares at S$0.25 each for listing on the Catalist Board in its initial public offer (IPO).

Of the total share offer, only 3.8 million shares will be made available for public subscription. The remaining 170 million shares will be placement shares.

At S$0.25 a share, Kimly is expected to have a market value of S$288.7 million after the IPO.

Kimly, which boasts of a network of 64 food outlets under management and 121 food stalls across the heartlands of Singapore - representing 5.8 per cent of the market share on September 30, 2015 - plans to use the net proceeds of about S$40.4 million from the IPO for acquisitions, joint ventures as well as general business expansion. It also plans to use the money for refurbishment and renovation of its food outlets; expand and upgrade its corporate headquarters as well as Central Kitchen. Some funds will also be used to boost its productivity.

Its directors intend to recommend and declare an annual dividend of not less than 50 per cent of Kimly's net profit.

Kimly's revenue grew at a compound annual growth rate (CAGR) of 7.6 per cent to S$172.2 million in FY2016 from S$148.9 million in FY2014, while net profit grew at a CAGR of 9.9 per cent from S$20.1 million to S$24.2 million during the same period. The group has no outstanding debt.

PrimePartners Corporate Finance is the issue manager and sponsor, while UOB Kay Hian is the underwriter and placement agent for the IPO.

The Invitation will close at 12 noon on 16 March 2017 and trading of Kimly's shares is expected to commence on a "ready" basis at 9.00 a.m. on 20 March 2017.